Lotte’s Restructuring Starts to Pay Off as Profitability Recovers

Lotte Group is experiencing a turnaround as its restructuring efforts start to bear fruit, with improved profitability across major subsidiaries and a more selective approach to capital allocation. The South Korean conglomerate has been reassessing its businesses in sectors such as chemicals, retail, and hotels, amidst weak domestic consumption and higher financing costs.

Chairman Shin Dong-bin emphasized the importance of innovation over tradition during a recent management meeting. A notable example of this new strategy is Lotte's decision to sell its controlling stake in Lotte Rental, a leading car rental company, to global private equity firm TPG. The proceeds from this transaction are expected to strengthen the financial position of the hotel affiliates and provide additional resources for investment in their core businesses.

Furthermore, Lotte Chemical has been working to rationalize its overseas operations and shift its portfolio toward higher-value specialty materials, with early signs of improved earnings.

Brief written by urgent.news from Korea IT Times's own syndicated text. Machine-written — may contain errors; check the original before relying on it.